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New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation...

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New Plans for the NM Oil Conservation Division Scott Dawson-Deputy Director IPANM’s 37 th Annual Meeting 8/7/2015
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Page 1: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

New Plans for the

NM Oil Conservation Division

Scott Dawson-Deputy Director IPANM’s 37th Annual Meeting

8/7/2015

Page 2: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

Since Statehood (January 12, 1912) various laws regarding oil and gas development existed. The evolution of Ft. Worth spudders and cable tools prompted changes in industry and regulations. In 1935, the legislature created the Oil Conservation Commission and subsequentaly the Oil Conservation Division (OCD). Prior to the OCD, the State Geologist Regulated Oil and Gas In New Mexico.

Page 3: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

OCD Functions

• Prevent waste & protect correlative rights • Permit new wells and recompletions • Regulate oil, gas and geothermal activity • Enforce OCD rules and state statutes • Gather and post well production data • Protect groundwater & environment • Ensure that the land is responsibly

restored

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OCD Goals and Objectives:

• Fair treatment of stakeholders • Enforce rules in a uniform manner • Timely review & approval of applications • Maintain an effective well inspection program • Protect fresh water resources & the environment • Update existing rules that may be required by

changes in technology and oil and gas business practices

Page 5: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

Partnerships & Collaboration

• Interstate Oil & Gas Compact Commission • Ground Water Protection Council • Bureau of Land Management • Environmental Protection Agency • New Mexico Oil & Gas Association (NMOGA) • Independent Petroleum Assoc. of NM (IPANM) • Permian Basin Petroleum Association (PBPA) • New Mexico Tech

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IOGCC’s States First is an exciting STATE led initiative aimed at facilitating multi-state collaboration and innovative regulatory solutions for oil and natural gas producing states.

IOGCC’s TOPCORP IOGCC’s TOPCORP Training Program is being utilized by OCD to provide advanced training to oil and gas field inspectors. This training will enable OCD field staff to keep up with current technology.

Partnerships & Collaboration

IOGCC’s State’s First

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• Formed in May, 2015 • IAG includes eight industry representatives • First meeting w/OCD held July 13th

• IAG will meet quarterly with OCD • NMOGA, IPANM & PBPA represented

Purpose of the IAG:

Provide a forum for discussion of issues of mutual interest, including new industry

technology & OCD rule changes

Industry Advisory Group (IAG)

Page 8: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

• Amended Financial Assurance Rule to allow

operators to post a blanket financial assurance for

wells held in TA status

• Amended Rule 34 for Recycling of Produced Water

• Established procedures within the Engineering

Bureau to speed up the processing of

administrative applications

• Obtained FY-16 legislative funding to purchase land

and design a new office building in Artesia

• Currently in the process of hiring additional staff in

all three district offices and Santa Fe

OCD Recent Actions

Page 9: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

Large recycling pit

Page 10: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...
Page 11: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

Setup Each tank can be delivered by just three trucks and erected in seven hours. A .25% grade is recommended at the setup location to allow maximum draining of the AST. Rockwater operators have experience with tank set-up in extreme heat and freezing weather conditions. 41,000 BW

Above Ground Storage Tanks (AST)

Page 12: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

OCD Rule Changes:

Stakeholder Participation

• OCD and/or Industry may propose an amendment to a Division statewide rule

• OCD will form joint OCD/Industry Committees comprised of OCD personnel and representatives from the oil and gas industry, including NMOGA, IPANM and PBPA, as well as other stakeholders when necessary

• Goal is to build consensus • Proposed rule changes will be presented by the

Committee to the Oil Conservation Commission

Page 13: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

• OCD and BLM meeting quarterly

• Discussion of potash drilling islands

• Working towards developing a Memorandum

of Understanding (MOU) for compliance &

enforcement

• Preliminary discussions on developing an

MOU for injection/disposal wells

Work closely with BLM in the formation of drilling islands in the potash area. Work closely with both the BLM and SLO to plug orphaned wells on state and federal lands. Examine OCD statewide rules in a systematic method in order to determine if rules need to be updated, amended, deleted etc.

Ongoing Activities:

Joint OCD/BLM Actions

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OCD is currently expanding its OCD-Online system to

increase publically available information, including:

• Inspection Information

• Violations

• Enforcement Actions

• Resolution of Enforcement Actions

• Fines and/or Penalties

Ongoing Activities

OCD-Online

Page 15: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

Ongoing Activities: GIS Capability

• OCD is developing a GIS module • GIS module will be publicly available on OCD Online

later this year • Module will initially contain a well layer linked to

OCD Online, & land ownership and spacing unit layers

Page 16: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

Ongoing Activities

Tracking Order Requirements

• Non-compliance by operators with the provisions of hearing and/or administrative orders is an ongoing problem

• OCD is developing a tracking system to assure compliance • OCD may take compliance action against those operators who

fail to comply with the terms of a order • To ensure compliance, please review all administrative and

hearing orders issued by the OCD to note all order requirements and deadlines

Page 17: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

POSSIBLE RULE CHANGES

Rule 19.15.16.15: Special Rules for Horizontal Wells

• Rule 19.15.16.15 was established in 2012 • Horizontal drilling techniques & operator business

practices have greatly advanced since that time • OCD needs to keep pace with changing technology • OCD anticipates that the horizontal well rule will be

revised and updated in the near future

Page 18: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

POSSIBLE RULE CHANGES

Rule 19.15.36 Surface Waste Management Facilities

• Rule 19.15.36 was last updated in 2008 • Permitting process for landfarms and landfills under

Rule 36 is unduly burdensome for the OCD and the applicant

• OCD is currently revising Rule 36 internally for the purpose of streamlining the permitting process.

• OCD will subsequently work with an industry committee to finalize the proposed rule changes

Page 19: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

POSSIBLE RULE CHANGES

Special Rules and Regulations for the Basin-Mancos

Gas Pool: Order No. R-12984

• The special rules for the Basin-Mancos Gas Pool were established in 2008 by Order R-12984

• Subsequent development indicates this pool, or a portion thereof, should be reclassified as an oil pool

• OCD is currently reviewing the existing rules to determine what changes are necessary

• OCD/Industry Committee will be formed to recommend changes to the existing rules

Page 20: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

Future OCD Revision

Guidelines for Remediation of

Leaks, Spills and Releases

The OCD’s Environmental Bureau is planning to revise and update the guidance document that outlines actions to be taken by operators in the event of leaks, spills and releases. It is necessary to update this document to reflect changes in technology and procedures

Page 21: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

We encourage you to utilize our website:

http://www.emnrd.state.nm.us/ocd/

Page 22: New Plans for the NM Oil Conservation Division - IPANM · New Plans for the NM Oil Conservation Division ... • Enforce OCD rules and state statutes ...

Scott Dawson Deputy Director, OCD Energy, Minerals and Natural Resources Department [email protected] (505) 476-3480 OCD Website: http://www.emnrd.state.nm.us/ocd OCD Well Information and Operator Data: https://wwwapps.emnrd.state.nm.us/ocd/ocdpermitting/Data/Wells.aspx

Thank You


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